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> A less direct form of price discrimination is to create a slightly different product that would only appeal to customers with more money. In software, we see
by cobbzilla 6y ago
> A less direct form of price discrimination is to create a slightly different product that would only appeal to customers with more money. In software, we see this often with features revolving around team management, accounting and compliance.
Um, if the feature set is different, that's a different product, not price discrimination.
Price discrimination is charging different customers different amounts for the same product.
I gave up after reading that.
[edit] OK I scanned the rest, and found a section titled "Hypocracy" -- is that a system of rule by the underclass? Or perhaps the author meant "Hypocrisy"... there's a bad joke somewhere in here given that the topic involves higher education.
- AlchemistCamp 6y agohttps://www.economicshelp.org/microessays/pd/price-discrimination/ https://www.economicshelp.org/microessays/pd/price-discrimin... > "One way firms practise price discrimination is to offer slightly different products as a way to discriminate between consumers ability to pay."
- cobbzilla 6y agoSorry, that explanation is just plain wrong. A car maker who offers a "GT" upgrade to their standard car model is not engaging in price discrimination, they're selling two different products. Selling movie tickets cheaper to students and the elderly is price discrimination. It's literally the same product, with a different price.
- AlchemistCamp 6y ago> "Sorry, that explanation is just plain wrong." I'm pretty sure I saw the same in my freshman econ textbook, long ago. Tyler Cowen also speaks of selling slightly different versions of a product in the MRU video on price discrimination: https://mru.org/courses/principles-economics-microeconomics/price-discrimination-examples-airlines-arbitrage https://mru.org/courses/principles-economics-microeconomics/... Looks like Wikipedia's article also states the same: https://en.wikipedia.org/wiki/Price_discrimination https://en.wikipedia.org/wiki/Price_discrimination
- perl4ever 6y agoThis depends on the semantics of the word "same". With modern technology, let's say you have a car with a higher trim package, and for a simplified example, let's say the upgrade is the radio. A manufacturer can and will make a new plastic trim piece with different buttons, but install the exact same radio behind it in all cars. The difference will be in a software or firmware switch that makes the radio behave differently. To the customer, it seems like a different product, but to someone who understands how it's done, who is selling it, it's not really. I think people find it useful to classify this as price discrimination. This is an example that comes to mind, by the way, because I once bought a (base model) car that used exactly this method, only the switch was misconfigured so the buttons acted like the expensive trim.